OK I know that is a bit of an odd title for a RE bear. However I do have a lot of friends who sell real estate and one thing I have seen over the years is how unfair it can be for those representing the buyers, in a hot and a cold market.
Let me explain. Lets say you have a prospective buyer in a sellers market. You take your buyer around, send them info, give them advice and then get repeatedly out-bid and have to start all over again.
In a dropping market, things are even worse. Buyers want to see everything out there, they often get cold feet and pull offers or put impossible conditions with multiple 'escape' clauses in.
Then one day you find out your buyer went to an open house and cut a deal with the listing agent who was 'double-ending it' and poof, your client and the many hours you spent working with them disappears.
What I heard some Realtors doing is charging a $500 fee to at least cover their gas money. If the buyer completes the transaction through that realtor, they refund the money. However if they don't or change Realtors then they forfiet the money.
What do you folks think about that? Would you be willing to pay $500 to get better service.
I think it is a good idea. It removes the time wasters. In truth the listing realtor often does less work than the one representing the buyer. I see some Realtors with dozens of listings. There is no way they can be marketing each one. They market themselves and then listings come to them since they are known as the high priced condo realtor... or the waterfront realtor.
The Realtors with the buyers then have to show up and sell their inventory for them.
How far can the post-election rally run?
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*Mid-week market update:* The latest BoA Global Manager Survey shows that
institutions have stampeded into U.S. equities in the wake of Trump's
victory. ...
1 day ago
I'll do it but as long as they only get a fixed fee if I buy. No commission for buyer agents.
ReplyDeleteFair enough. As a buyer, I'd like my realtor to get paid by me, not by the seller's agent, just like lawyers, doctors, etc. It's abnormal that a buyer agent would have a conflict of interest - the higher the sale price the higher the commission. I'd give an incentive for reducing the price.
ReplyDeleteThere is a contract the buyers can sign that ensure the realtor is counted in for any transaction. But I suppose getting them to sign it on paper might feel awkward? Like getting someone to sign a prenuptial?
ReplyDeleteI have always thought it was way easier for the buyers agent.
ReplyDeleteThe selling realtor has to list the place, hold open houses and deal with the seller.
All the buyers agent has to do is show them around and hope to get lucky that they buy a place. It really depends on the buyer if this will be a fruitful search or not as it could get quite frustrating for the reasons you state.
Luc is right though, the buyers agent gets half of the commission, which is based on the selling price (correct?) so that is hardly an incentive for the buying realtor to negotiate a lower price.
I never really got the point of buyers agents anyway. I know what I want better than anyone, why dont I just go look myself? The internet makes it pretty damn easy these days.
I can imagine that a guarantee of gas money for a good realtor is a fair deal. I would magine being a realtor for an FTB is the hardest job going right now. Crappy places at exhorbitant prices aren't an easy sell. If I was a realtor I would stay as far away as possible from FTBs. A second (or third) time buyer isn't looking at crap so much so I would imagine the sale is easier. The problem is that realtors never want to tell the truth about your situation. I went on two fruitless bouts of searching for places in the past. Both times I was up front and told the realtor to tell me if I was priced out so neither of us would be wasting our time. Both times I was assured they could find something to suit me. I'm still renting. Should I have to pay gas money to someone who hasn't got the honesty to tell me my budget doesn't fit the market? -Markoz
ReplyDeleteI take pride in fairly compensating people who do good work for me. I would be much happier with a flat fee, biweekly, with some minimum number of hours, showings, and access to services, etc. Commissions for everybody favors sellers, encourages bubbles, and gets you bad service when the market is down.
ReplyDeleteIf I buy I will offer to pay a flat fee, because I want to be stingy with the house but not the person helping me buy it.